On January 1, 2016, Hoosier Company purchased $924,000 of 10% bonds at face valu
ID: 2593501 • Letter: O
Question
On January 1, 2016, Hoosier Company purchased $924,000 of 10% bonds at face value. The bond market value was $977,000 on December 31, 2016.
Prepare the appropriate journal entry on December 31, 2016, to properly value the bonds assuming the bonds are classified as: (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
On January 1, 2016, Hoosier Company purchased $924,000 of 10% bonds at face value. The bond market value was $977,000 on December 31, 2016.
Explanation / Answer
Prepare the appropriate journal entry on December 31, 2016, to properly value the bonds assuming the bonds are classified as: (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Trading securities.
Securities available for sale.
Held-to-maturity securities.
Date accounts & explanation debit credit dec 31 Trading securities 53000 Unrealized gain on trading securities 53000 (To record market value increase)